State to Buy Ahmanson as Preserve

California has agreed to buy the 2,800-acre Ahmanson Ranch, ending a 17-year battle between developers who sought to create a new city on the Los Angeles-Ventura County border and a coalition of environmentalists, homeowners and celebrities whose lobbying efforts will preserve the rolling hills and oak savannas for hiking and open space.

The tentative $150-million deal with landowner Washington Mutual, confirmed Monday, would block development on one of the largest remaining tracts of privately owned land in the mountains that ring the San Fernando Valley.

Ventura County approved a 3,050-home golf course community in 1990, but the project was stalled by lawsuits, the discovery of a rare frog and flower, and, finally, a $1.5-million campaign led by movie director Rob Reiner.

The sale is expected to win final approval in early October, state officials said. Washington Mutual, the nation’s largest lending bank, is expected to sign a sales contract later this week. The firm has refused to comment until the deal is done.

“I’m not aware of any remaining obstacles, and I don’t expect any,” said Al Wright, executive director of the Wildlife Conservation Board, which is expected to provide $135 million. “It’s a big deal to us.”

Opponents had threatened to spend as much money as necessary to block the $2-billion development, which they said would destroy a compelling natural landscape and dump 37,500 cars a day onto the Ventura Freeway.

Reiner, co-chairman with HBO executive Chris Albrecht of the Rally to Save Ahmanson Ranch, said Monday that he is afraid to declare victory yet. “We’re not going to count our chickens until they’re hatched,” he said. “But we’re very optimistic at this point. This is huge.”

Washington Mutual acquired rights to Ahmanson Ranch as part of its purchase of the H. F. Ahmanson Co. in 1998. At that time, sources have said, appraisers valued the land at $300 million as a development project. A new appraisal last year set that value at closer to $600 million, the sources said.

The Ahmanson Ranch project was the darling of urban planners and even some environmentalists when first proposed in 1986.

But the development by the nation’s largest savings and loan placed on a collision course two powerful imperatives of California politics -- the push for so-called smart growth that puts badly needed new housing close to jobs, and the pull of a growing grass-roots movement to preserve dwindling open space.

For years, acquisition of Ahmanson Ranch has been the top priority of the Santa Monica Mountains Conservancy, an arm of the state Resources Agency. The property is highly valued because it is a relatively short drive from dense urban communities, it serves as a wildlife corridor and it is at the head of the Malibu Creek watershed, officials have said. It is also considered prime for hiking and family outings.

Developers prevailed in more than a dozen lawsuits and seemed ready to build in 1998, before a San Fernando Valley spineflower was discovered decades after it had been thought extinct. Studies of the flower and dozens of rare red-legged frogs discovered nearby stopped the project until late last year.

But when new environmental studies found that the plant and the amphibian could survive urbanization in preserves planned by developers, the Ventura County Board of Supervisors approved the project again.

Washington Mutual officials said they saw the ranch as a logical answer to a state housing crisis.

Despite the state’s interest, purchase of Ahmanson Ranch has been blocked for years because Washington Mutual refused to sell, no purchase price had been negotiated and state money had not been approved.

“Now we’ve cleared two of the three major hurdles,” said Joseph Edmiston, executive director of the mountains conservancy. “But the last thing I want to do is say it’s a done deal: It’s not. But we’re in the home stretch.”

Edmiston said the company is now a willing seller and has agreed that $150 million is a fair price.

The Ahmanson Ranch deal is one of two major parkland and habitat purchases on the conservation board’s Sept. 30 agenda. Gov. Gray Davis signaled last week that he would back a $139-million agreement to save about 500 acres of the Ballona Wetlands near the Playa Vista development south of Marina del Rey. Both acquisitions are subsidized by Proposition 50, a bond measure approved by voters last year.

The properties “are crown jewels that deserve to be protected and preserved,” said Steve Maviglio, spokesman for Davis.

Davis in a statement Monday said the acquisition will provide scarce open space in “the heart of a major metropolitan area.”

The value of the land was appraised by a state consultant at $190 million, and Washington Mutual’s appraisers valued it at $170 million, Wright said. Negotiators finally arrived at the price of $150 million.

Washington Mutual can seek federal tax deductions for the difference between the purchase price and the property’s appraised value, Wright said.

“We acknowledge that the landowner intends to seek that tax benefit,” he said.

The value of the ranch was determined by taking into account its legal right to be developed as an 8,000-resident city, considering its continuing legal challenges and topographical limitations, and factoring in whether it could ever overcome all obstacles to development.

With new legal challenges, the developer faced an uncertain future and began negotiating a potential sale with the state last spring.

Times staff writer Evan Halper contributed to this report.